Medical debt, charity care and what to ask first

Nonprofit hospitals must have a written financial assistance policy under IRS section 501(r), publicize it, and limit what eligible patients are charged. They must also make reasonable efforts to check eligibility before extraordinary collection actions.

First questions to ask

• Is the hospital tax-exempt? Request the financial assistance policy, the plain-language summary and the application.
• Has the client received an itemized bill?
• Is the account already with a collector? Assistance applications may still be possible.

The CFPB has reported that medical debt is the most common debt on US credit reports, and billing errors are frequent.

Sources: IRS 501(r)(4) (opens in a new tab); CFPB, Medical debt burden in the United States (opens in a new tab).